AIOFP fund to protect ‘soft targets’
The AIOFP has updated its members on how they can be protected, via its member protection fund (MPF), from unfair legal action.
Styled on the Police Association Fund, the AIOFP's fund – which was launched late last year – aims to protect innocent advisers from being targeted in unfortunate circumstances outside of their control.
AIOFP executive director Peter Johnston said advisers are considered the "soft target" due to their professional indemnity cover, which has allowed those who are responsible for "calamities" to avoid accountability for their negligence.
Mr Johnston added that for "far too long" innocent advisers have been destroyed both commercially and politically by "exuberant stakeholders", having lacked the resources to defend themselves.
"In the case of product failure, advisers do not build, register, manage or rate products but somehow get blamed for their demise," he said.
"The MPF is priced at $1 per day and is incorporated in the new adviser member status now available to individual advisers. Of the $500 (+ GST) membership fees, $365 goes into the MPF to protect their future.
"This not only gives the adviser peace of mind but [also] the practice principal if the adviser is unfairly targeted," Mr Johnston said.
As long as the MPF member is innocent they will have the protection of a "strong fund" with expert legal and commercial resources to protect them, he said.
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